BURSA–Fundamental Analysis (20 Apr 2014)

– Market Timing: – EY%: Buy below 8.27, sell above 11.06 – In my opinion, in FY14, the following risks will outweigh the growth drivers – Withdrawal of foreign investors in very large scale. – US QE taper will cause higher volatility in the market. This may cause investors stay out of (or monitor) the equity market. – Despite risks of higher volatility due to QE taper, The 1Q14 earnings results were, in all, a good start to the year for Bursa. The increased interest by retail investors, in particular, is a positive sign. Local institutions remain a steady presence in the market, buffering stocks from the worst of the effects of selling by foreign investors. – I remain sanguine on the company’s outlook over the longer term, as a proxy for the country’s growth. Its business model is also fairly resilient. As mentioned above, recurring and other incomes, including interest income, is sufficient to cover some 91% of total operating expenses. – I may/may not accumulate BURSA in the near term. Let see how it goes.